Schiphol plays key role in European air cargo industry

20 May 2015

The most important airport in the Netherlands, Schiphol Amsterdam Airport, has a 14% market share of the top 10 most important European airports. The airport thereby, relatively to the economy, is performing well above par, finds recent research from consulting firm Seabury Group in commission of the Dutch Ministry of Infrastructure and Environment. Further expansion of market share can be realised in the pharmaceutical and machine parts sectors.

Airfreight and trade are critical for European economies and many industrial sectors in Europe. More than 50% of the non-bulk import and export to and from Europe is carried by air. For Western Europe alone this translates to 8,9 million tons of goods with a total value of $1,234 billion in 2013. Over the period 2005 - 2013 the total weight of air freight increased by 1.2% and the total value by 5,1%. And if the trend seen over past years continues, then trade via air carrier is only set to pick up further.

Total air trade value

Dutch market share
The Netherlands has proven itself successful in the area of air freight, with 1.5 million tons worth of goods passing through Schiphol. The traditional Dutch trade-oriented attitude has worked immeasurably toward an impressive market position relative to the rest of Western Europe: with 7% of exports leaving its airports (at around $48 billion) and 17% arriving at them (at around $80 billion). Compared to the relative economic clout of the Dutch economy – 5% of that of Western Europe’s GDP – a strong position, says Seabury Group, a
consulting firm with expertise in the fields of aerospace and transport.

The Netherlands is key in the European air cargo market

The Netherlands’ most important airport thereby has a market share of 14% of Europe’s 10 most important airports. A deeper analysis of the 1.5 million tons that pass through its gates shows that nearly all imported goods are for consumption by the Dutch market, yet in the case of exports 48% of goods are destined for foreign markets. In other words, Schiphol is frequently used by foreign manufacturers as an export hub.

Netherlands trade data and traffic statistics

Flowers and high-tech
The consultants also looked at the competitive position of Schiphol per industry, with Dutch strengths found back in perishable goods – which is mainly in flowers – and high tech goods. For perishable goods the Netherlands has a market share of 26%, for high tech goods the market share is slightly smaller, at 21%. In other sectors the Dutch market share is considerably smaller, between capital equipment at 6% and industrial consumables at 9%; while the market share in the automotive market is lower at 4%.

Western Europe air trade growth by commodity vs Netherslands trade share

KLM is by a distance the most important freight carrier, good for around 300,000 tons, followed by the company’s daughter enterprise Martinair. The competitive position of the Dutch market leaders is under threat, according to Seabury Group, the result of AirFrance-KLM’s strategic choice to reduce its cargo branch and from increasing competitive forces from Middle Eastern and far Eastern carriers. Carriers like China Southern, Emirates and Qatar Airways are in possession of more advanced fleets, on top of that they have earmarked cargo as one of the strategic pillars for the realisation of further penetration into the Western European market.

Available outbound cargo capacity from AMS

Market improvement
Further improvements in market share for Schiphol may be found in the chemical (particularly pharmaceutical) sector and the trade of machine parts. In both commodity markets the size of trade has increased in Europe in recent years. While pharmaceutical and machine parts are not the only sectors in which trade goods are found to be growing, they are the most lucrative sectors in terms of volume ratio. Chemicals have an average value of $268 per kg and machine parts $107 per kilo, which is higher than all other goods. With exclusion of high tech goods, which go at $388 per kilo, and is also the sector in which the Netherlands has a strong market position. Perishable goods, although with a low value - volume ratio, remain important for Schiphol because of the large market share.

Value density gives an indication of attractiveness of goods

Further expansion in other sectors will however, not be easy. The consultants note that airports in neighbouring countries each have their own export / import mix 'profile', thus snatching market share from other strong players would require considerable investment. France is for instance known for its strength in machine parts, while Belgium is known for its role in logistics around chemicals.

Breakdown of country trade by commodity type

Best airports

Schiphol’s success has not gone unnoticed. The Dutch airport has for years been in the top ten airports worldwide. The highest place it achieved was #3 in 2013. Last year the airport came in at #5 – passed by the airports of Munich and Hong Kong.

* Seabury Group was founded in 1995 and is based in New York. The business services provider has more than 275 professionals with expertise in several sectors (including aviation, aerospace and defence, transportation and financial services) and operates in 14 countries across 5 continents.